Southland Corporations decision to produce a new line of recreational products resulted in the need to construct
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Question:
Southland Corporation’s decision to produce a new line of recreational products resulted in the need to construct either a small plant or a large plant. The best selection of plant size depends on how the marketplace reacts to the new product line. To conduct an analysis, marketing management has decided to view the possible long-run demand as low, medium, or high. The following payoff table shows the projected proft in millions of dollars:
Long-Run Demand | |||
Plant Size | Low | Medium | High |
Small | 180 | 210 | 290 |
Large | 50 | 220 | 400 |
- What is the decision to be made, and what is the chance event for Southland’s problem? choose one below (The decision to be made is the plant size and the chance event is the long-run demand). (The decision to be made is the long-run demand and the chance event is the plant size.)
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